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Planet Fitness (PLNT) Q2 Earnings Match Estimates, Revenues Lag
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Planet Fitness, Inc. (PLNT - Free Report) reported second-quarter 2022 results, with earnings meeting the Zacks Consensus Estimate and revenues missing the same. However, the metrics increased on a year-over-year basis.
Following the announcement, shares of the company fell 5.7% during trading hours on Aug 9. Negative investor sentiments were witnessed as the management cited concerns about a challenging operating environment because of lingering COVID impacts and inflationary pressures.
Earnings & Revenue Discussion
During the second quarter, the company reported adjusted earnings per share (EPS) of 38 cents, in line with the Zacks Consensus Estimate. In the prior-year quarter, the company reported adjusted earnings of 21 cents per share.
Planet Fitness, Inc. Price, Consensus and EPS Surprise
Quarterly revenues of $224.4 million fell short of the consensus mark of $231 million. However, the top line surged 63.5% from the year-ago quarter’s levels, driven by solid performances in the Franchise, Corporate-owned Stores and Equipment segments. During the quarter under review, system-wide same-store sales increased 13.6% year over year compared with growth of 15.9% reported in the previous quarter.
Total adjusted EBITDA at the end of the second quarter was $89.9 million compared with $55.6 million reported in the year-ago quarter.
Segmental Performance
During second-quarter 2022, Franchise segment revenues were $82.5 million, up 13.3% year over year. The upside was driven by a $6.2 million rise in franchise royalty revenues, a $1.6-million gain in National Advertising Fund ("NAF") revenues and a $1.7-million surge in placement revenues.
EBITDA in the Franchise segment was $54.3 million compared with $51.8 million reported in the prior-year quarter.
The Corporate-owned Stores segment’s second-quarter revenues amounted to $60.9 million compared with $40.6 million reported in the prior-year quarter. The increase can primarily be attributed to a rise in same-store sales and new store openings. The acquisition of 114 stores through the Sunshine Fitness buyout contributed $49.5 million to the segment revenues. The segment’s EBITDA totaled $39.5 million compared with $10.4 million reported in the prior-year quarter.
In the Equipment segment, revenues totaled $40.4 million compared with $23.8 million in the prior-year quarter. The uptick was primarily driven by higher equipment sales to new and existing franchisee-owned stores. EBITDA in the Equipment segment was $10.2 million compared with $5.6 million reported in the prior-year quarter.
Other Financial Details
As of Jun 30, 2022, cash and cash equivalents totaled $383.5 million compared with $471.2 million as of Mar 31, 2022. Long-term debt (net of current maturities) amounted to $1,985.7 million at the end of second-quarter 2022 compared with $1,989.5 million at the prior-quarter end.
2022 Outlook
For 2022, the company continues to expect revenues to increase in the mid-50% range over the 2021 levels. Adjusted EBITDA for 2022 is estimated to rise in the high-50% range, while adjusted net income is anticipated at the low-90% range over the 2021 levels. The company anticipates adjusted EPS to increase in the mid-80% range over the 2021 levels. The metrics are based on the assumption of potential impact from the Sunshine Fitness acquisition and that there is no significant impact of the COVID-19 pandemic.
Playa Hotels sports a Zacks Rank #1. PLYA has a trailing four-quarter earnings surprise of negative 8.8%, on average. The stock has gained 1.5% in the past year.
The Zacks Consensus Estimate for PLYA’s current financial year sales and EPS indicates an increase of 54.2% and 183.33%, respectively, from the year-ago period’s reported levels.
Marriott carries a Zacks Rank #2 (Buy). MAR has a trailing four-quarter earnings surprise of 18.6%, on average. The stock has increased 15.1% in the past year.
The Zacks Consensus Estimate for MAR’s current financial year sales and EPS indicates growth of 46.1% and 101.6%, respectively, from the year-ago period’s reported levels.
Choice Hotels carries a Zacks Rank #2. CHH has a trailing four-quarter earnings surprise of 11.2%, on average. The stock has declined 5.9% in the past year.
The Zacks Consensus Estimate for CHH’s current financial year sales and EPS indicates growth of 18.1% and 19.4%, respectively, from the year-ago period’s reported levels.
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Planet Fitness (PLNT) Q2 Earnings Match Estimates, Revenues Lag
Planet Fitness, Inc. (PLNT - Free Report) reported second-quarter 2022 results, with earnings meeting the Zacks Consensus Estimate and revenues missing the same. However, the metrics increased on a year-over-year basis.
Following the announcement, shares of the company fell 5.7% during trading hours on Aug 9. Negative investor sentiments were witnessed as the management cited concerns about a challenging operating environment because of lingering COVID impacts and inflationary pressures.
Earnings & Revenue Discussion
During the second quarter, the company reported adjusted earnings per share (EPS) of 38 cents, in line with the Zacks Consensus Estimate. In the prior-year quarter, the company reported adjusted earnings of 21 cents per share.
Planet Fitness, Inc. Price, Consensus and EPS Surprise
Planet Fitness, Inc. price-consensus-eps-surprise-chart | Planet Fitness, Inc. Quote
Quarterly revenues of $224.4 million fell short of the consensus mark of $231 million. However, the top line surged 63.5% from the year-ago quarter’s levels, driven by solid performances in the Franchise, Corporate-owned Stores and Equipment segments. During the quarter under review, system-wide same-store sales increased 13.6% year over year compared with growth of 15.9% reported in the previous quarter.
Total adjusted EBITDA at the end of the second quarter was $89.9 million compared with $55.6 million reported in the year-ago quarter.
Segmental Performance
During second-quarter 2022, Franchise segment revenues were $82.5 million, up 13.3% year over year. The upside was driven by a $6.2 million rise in franchise royalty revenues, a $1.6-million gain in National Advertising Fund ("NAF") revenues and a $1.7-million surge in placement revenues.
EBITDA in the Franchise segment was $54.3 million compared with $51.8 million reported in the prior-year quarter.
The Corporate-owned Stores segment’s second-quarter revenues amounted to $60.9 million compared with $40.6 million reported in the prior-year quarter. The increase can primarily be attributed to a rise in same-store sales and new store openings. The acquisition of 114 stores through the Sunshine Fitness buyout contributed $49.5 million to the segment revenues. The segment’s EBITDA totaled $39.5 million compared with $10.4 million reported in the prior-year quarter.
In the Equipment segment, revenues totaled $40.4 million compared with $23.8 million in the prior-year quarter. The uptick was primarily driven by higher equipment sales to new and existing franchisee-owned stores. EBITDA in the Equipment segment was $10.2 million compared with $5.6 million reported in the prior-year quarter.
Other Financial Details
As of Jun 30, 2022, cash and cash equivalents totaled $383.5 million compared with $471.2 million as of Mar 31, 2022. Long-term debt (net of current maturities) amounted to $1,985.7 million at the end of second-quarter 2022 compared with $1,989.5 million at the prior-quarter end.
2022 Outlook
For 2022, the company continues to expect revenues to increase in the mid-50% range over the 2021 levels. Adjusted EBITDA for 2022 is estimated to rise in the high-50% range, while adjusted net income is anticipated at the low-90% range over the 2021 levels. The company anticipates adjusted EPS to increase in the mid-80% range over the 2021 levels. The metrics are based on the assumption of potential impact from the Sunshine Fitness acquisition and that there is no significant impact of the COVID-19 pandemic.
Zacks Rank & Stocks to Consider
Planet Fitness currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the Consumer Discretionary sector are Playa Hotels & Resorts N.V. (PLYA - Free Report) , Marriott International, Inc. (MAR - Free Report) and Choice Hotels International, Inc. (CHH - Free Report) .
Playa Hotels sports a Zacks Rank #1. PLYA has a trailing four-quarter earnings surprise of negative 8.8%, on average. The stock has gained 1.5% in the past year.
The Zacks Consensus Estimate for PLYA’s current financial year sales and EPS indicates an increase of 54.2% and 183.33%, respectively, from the year-ago period’s reported levels.
Marriott carries a Zacks Rank #2 (Buy). MAR has a trailing four-quarter earnings surprise of 18.6%, on average. The stock has increased 15.1% in the past year.
The Zacks Consensus Estimate for MAR’s current financial year sales and EPS indicates growth of 46.1% and 101.6%, respectively, from the year-ago period’s reported levels.
Choice Hotels carries a Zacks Rank #2. CHH has a trailing four-quarter earnings surprise of 11.2%, on average. The stock has declined 5.9% in the past year.
The Zacks Consensus Estimate for CHH’s current financial year sales and EPS indicates growth of 18.1% and 19.4%, respectively, from the year-ago period’s reported levels.